U.S. Treasury prices were little changed on Tuesday after a $32 billion auction of two-year fixed-rate notes and as investors awaited the outcome of a two-day Federal Reserve policy meeting.
The Treasury Department auctioned the notes at a high yield of 0.380 percent. The bid-to-cover ratio, an indicator of demand, was 3.30.
At its meeting, which starts later Tuesday, the U.S. central bank will consider whether to further scale back its bond-purchase program, which is aimed at holding down long-term borrowing costs to help the economy.
Analysts said investors are reluctant to buy safe-haven bonds on fears that any surprise in the Fed statement could derail this month's rally in Treasury prices.
"Investors are having reticence about the level of the market in the face of the Fed announcement," said Robert Tipp, chief investment strategist at Prudential Fixed Income in Newark, New Jersey.
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In December, the Fed reduced its monthly purchases of Treasuries and mortgage-backed securities by $10 billion to $75 billion. Some analysts expect the Fed will cut purchases by another $10 billion this week. The Fed will issue its policy statement at the close of its meeting on Wednesday afternoon.
Commerce Department data showing orders for long-lasting U.S. manufactured goods unexpectedly fell in December by 4.3 percent initially spurred safe-haven bids and a rise in Treasury prices, but the gains were short-lived as worries set in surrounding the Fed outcome.